In the global financial sector, culture continues to be a fundamental priority for a growing number of firms regulated by the Financial Conduct Authority. It is, however, worth noting that there is no one-size-fits-all approach and that every organisation is responsible for introducing and maintaining cultures in an attempt to reduce risk and minimise harm. If you are interested in finding out how important culture is for FCA regulated firms, continue reading.
A fresh approach to culture
In the past, the FCA has largely focused on the prevention of regulatory breaches, such as fraud and money laundering, when it comes to their approach to organisational culture. In recent years, however, a noticeable shift has taken place that has seen the country’s conduct regulator address a number of national and global issues in relation to the preservation of culture. It has therefore, in response to this shift, introduced a fresh approach to culture and redefined culture as a set of behaviours and mindsets that characterise the overall feeling of an organisation within the financial sector. It has led to a growing number of businesses re-shifting their attention to focus on purpose, leadership, governance, and an enhanced approach to rewarding and managing employees. In addition, it is clear that FCA regulated firms are committed to meeting both short-term and long-term cultural goals and transforming the way in which they respond to a number of widespread cultural issues in the process.
A work in progress
It may have emerged as a relatively recent phenomenon, but it is part of a larger work in progress for FCA regulated firms that have been striving to improve their approach to culture for almost a decade. It has been heralded as a main priority for FCA regulated firms since 2015 but it may take a number of years to come to fruition as both minor and major changes are implemented by organisations across the sector on a wider scale. In doing so, the FCA hopes to prevent the risk of retail misconduct by encouraging compliance consulting and improve its trust in a wide range of financial services. It has also recently reminded firms of an expectation to demonstrate an awareness of their underlying expectations on culture, echo these beliefs in their daily practices, and adjust their strategy as necessary if the FCA identifies any shortcomings.
A changing working environment
In order to prioritise culture, FCA regulated firms must adapt to a changing working environment. This is largely due to a recent industry-wide shift to hybrid working practices and a growing number of financial firms adopting flexible working arrangements on either a part-time or full-time basis and the changes that must take place in regard to culture as a result. In response, the FCA will assess and deliver feedback when it comes to how successfully, or unsuccessfully, firms are taking steps to shape their culture on an ongoing basis as it continues to become a key consideration for financial firms up and down the country.
In recent years, FCA regulated firms have adopted a brand-new mindset and re-shifted their focus when it comes to the ways in which they view culture. In response, this has led to a fresh approach to culture by responding to cultural issues on a national and global scale and has emerged as a work in progress with both minor and major changes taking place on an ongoing basis. in addition, it has also led to a changing work environment as hybrid working practices become commonplace and force financial firms to make changes when it comes to the ways they shape their culture.